Is intersection of labels acceptable in computer vision?
In my opinion, the second option will be more general. You can refer to some famous datasets for object detection task such as COCO or Pascal VOC, they usually accept the intersect annotations. As the image below, image from this link where they process the annotation of COCO dataset.
I think the reason is that the model will be easier to separate the intersect patterns in the bounding box than interpolate the missing patterns of the object to understand it